Rideshare services like Uber and Lyft are convenient, but accidents involving these vehicles can raise questions about insurance coverage. While Uber and Lyft provide insurance for their drivers and passengers, the extent of that coverage depends on specific circumstances at the time of the accident. Here’s what you need to know about how rideshare insurance works in California.
1. The $1 Million Insurance Policy: When It Applies
Uber and Lyft provide up to $1 million in liability coverage, but this level of coverage applies only during specific periods of a driver’s use of the rideshare app. These periods are defined as follows:
Period 1: The driver is logged into the app but has not yet accepted a ride request.
Coverage: Limited liability insurance of $50,000 per person, $100,000 per accident for bodily injury, and $30,000 for property damage. This is often contingent on whether the driver’s personal auto insurance policy excludes rideshare activity.
Period 2: The driver has accepted a ride request and is on the way to pick up the passenger.
Coverage: The $1 million liability policy applies during this time.
Period 3: The passenger is in the vehicle, and the trip is active.
Coverage: The $1 million policy remains in effect and also includes uninsured/underinsured motorist (UM/UIM) coverage for passengers.
If the driver is not logged into the app, Uber and Lyft’s insurance does not apply, and the driver’s personal auto insurance is solely responsible for any claims.
2. If You Are a Passenger
If you are injured as a passenger in an Uber or Lyft vehicle, you are covered by the $1 million liability policy during your ride (Period 3). This coverage applies regardless of whether the accident was caused by the rideshare driver or another motorist. Additionally, if the at-fault driver has insufficient or no insurance, the rideshare company’s uninsured/underinsured motorist coverage can provide compensation for medical expenses, lost wages, and other damages.
3. If You Are the Driver
For rideshare drivers, coverage depends on your status in the app:
Logged Out of the App: No coverage from Uber or Lyft applies. Your personal auto insurance policy is solely responsible.
Logged Into the App but No Ride Accepted (Period 1): Limited liability coverage from Uber or Lyft applies, but this does not cover damage to your vehicle or injuries you sustain.
Ride Accepted or Passenger in Vehicle (Periods 2 and 3): The $1 million policy applies, including liability coverage for others and UM/UIM coverage for passengers. This policy typically does not cover collision damage to the driver’s own vehicle unless they have opted into Uber or Lyft’s collision coverage (with a deductible).
4. Misconceptions About the $1 Million Policy
While the $1 million policy is significant, it is not all-encompassing. It does not cover every scenario and is primarily designed to provide liability protection for the rideshare driver and uninsured/underinsured motorist coverage for passengers. It does not automatically cover damage to the rideshare driver’s own vehicle or injuries to the driver unless they have opted for supplemental coverage provided by the rideshare company.
Additionally, the $1 million policy is not the same as corporate insurance Uber or Lyft may carry to protect their companies from broader legal liabilities. These corporate policies rarely apply to individual accidents unless extraordinary circumstances are involved.
5. What to Do If You’re Involved in an Accident
Gather Information: Document the details of the accident, including the rideshare driver’s app status, contact information, and insurance details.
Report the Accident: Notify Uber or Lyft through their in-app reporting tools and inform your personal auto insurer if you’re the driver.
Seek Medical Attention: Always prioritize your health and safety, even if injuries seem minor at first.
Consult an Attorney: Rideshare accident claims often involve multiple insurance policies with overlapping or conflicting coverages. An experienced attorney can help navigate this complexity and ensure you pursue all available compensation.
Conclusion
Understanding Uber and Lyft’s insurance policies is critical if you’re involved in an accident as a passenger, driver, or other party. While the $1 million policy provides substantial protection during active rides, its application is limited by specific conditions. Knowing these distinctions can help you make informed decisions and secure the compensation you deserve.
If you’ve been injured in an Uber or Lyft accident, our firm is here to guide you through the claims process and advocate for your rights. We are experienced in handling rideshare-related cases and can provide the clarity and support you need during this challenging time.
